Myanmar market captures investors’ attention

HCMC – Many Vietnam-based companies are eyeing Myanmar as a new investment
destination after the Myanmar Government approved a new foreign investment law
offering strong incentives for international investors.

At a seminar on investment into Myanmar held in HCMC on Thursday, Edwin
Vanderbruggen of VDB Loi Law Co. said despite the imperfect new law, Myanmar
now is changing at a rapid rate.

He compared the case of Myanmar to that of Vietnam, saying the country has
still attracted large numbers of foreign investors in spite of its incomplete
legal corridor and yet-to-be-favorable business environment.

At the moment, Myanmar is considered the last attractive destination in
Southeast Asia to foreign enterprises, he told the seminar held by the
Malaysian Enterprises Department in Vietnam.

Foreign investors have considered sky-high tax levels in Myanmar the biggest
barrier discouraging them from participating in the market, he pointed out. But
the newly-issued law allows new investors to be subject to tax exemption for up
to five years compared to only three years as specified in the 1988 law and
this is really worth consideration, he said.

The new law is also loosened compared to the old regulations issued in 1988
regarding investment. Foreign entities are currently allowed to pour capital
into mining, industrial and manufacturing sectors, construction, transport and
repairing services, road transport or hotels.

However, a number of business activities with foreign investment will be
banned or restricted in certain areas or business spheres.

Vanderburggen predicted there would be a lot of changes in the coming time
which are expected to pave the way for Myanmar to join the ASEAN + China free
trade zone in 2015.

A slew of enterprises have shown keen interest in the market, including
foreign-invested companies operational in Vietnam.

Bill Watson, general director of Coats Phong Phu Co. in Vietnam, said he is
considering a convenient point of time to make investment into Myanmar.

Several other big companies at the seminar said they had plans to open their
representative offices in Myanmar soon. Therefore, there might be a tough race
among foreign firms in Vietnam as well as Vietnamese companies and investors
from other regional nations to invest into Myanmar in the near future.

Vietnamese firms like CT Group and Huu Lien A Chau along with many firms
under the Association of High-Quality Vietnamese Goods Producers over the past
time have sought ways to approach the Myanmar market to sound out investment
and trade opportunities.